I'm just going to start the audience portion before we get started, so let's get your clickers ready, we're going to try and do the automated audience response system real quick. The first one, hopefully is obvious. Will health reform be a positive for LifePoint in 2014? Let's start with very negative at 1, very positive at 5.

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

All right. Easy consensus there. There's still one stickler for negative for hospitals, we're going to find this person by the end of the conference. Second question, as LifePoint contracts remember their geographies and their markets relative to others, would we expect those rates to be closer to Medicaid or commercial?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

All right, a little bit more mixed than I would've expected, but okay. Next question, utilization trends, so think about admits here. Would we expect in 2013 a significant increase or a significant decrease somewhere between 1 and 5?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

So probably flat to up is what it looks likes. Next question, how would you like to see the company deploy its capital, would that be through M&A/JVs, repurchase shares, increase dividends, repay debt or invest in the core business?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

So mostly M&A, more than half M&A. Okay, that's interesting. Do you think then this is the -- we've been using earnings per share. Will earnings per share be up in 2014?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

A lot of quick response, wow, there we go. We have a consensus. All right. Current -- do you currently own shares of LifePoint?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

A 50-50 split, so you got a little bit of work. And then last but not least, let's get the sentiment question, would your bias on the stock be positive, neutral or negative?

[Voting]

Joshua R. Raskin - Barclays Capital, Research Division

All right, certainly, a positive bias here, it's not surprising, that's great. So I'm going to turn it over to Bill Carpenter as they load up the slides in the back, the company's Chairman and CEO. I've already taken more than 3 minutes of your time, Bill. So I'm going to turn it over to you. We're going to hold questions until we get to the breakout session after that. So with that, my pleasure to introduce Bill.

William F. Carpenter

Yes, Josh, thanks very much. And thank you, all, for being here on a beautiful afternoon. I'll talk a little bit about LifePoint Hospitals. I love this feedback, it's very, very good and good to know.

So today, I'll talk about the LifePoint story, which is executing on a focused strategy. I'll talk about the financial performance of the company, as well as what we have done and are doing in order to position the company for long-term value creation. These will be the highlights that we go through as we go through the presentation. LifePoint is achieving growth by focusing on a very clear strategic plan that I'll review with you.

We're improving quality of care and service in our hospitals. We continue to do things to grow in every single market in which we own hospitals. We're recruiting physician, adding service lines in our communities. We have one of the best balance sheets in the industry, continuing to be levered at about 3x earnings. We have done a number of acquisitions recently, and I'll talk about those, especially since I've received the feedback in the questionnaire that you want to see acquisitions. We can talk more about that. And the Duke-LifePoint partnership really is an important thing and I believe a differentiator for our company. It's an active partnership in which we have acquired 4 hospitals to date, and 3 of which, we are improving quality in rural hospitals around the country.

And the pipeline for acquisitions is strong. So LifePoint's geographically diverse. We own 57 hospitals today in 20 states around the country. That's important from the point of view of spreading the risk of any one particular state's Medicaid program across the many states.

We -- it has been reported in the local press recently that we have 3 letters of intent currently in place: 1 in Virginia and 2 in Michigan. And so I'll talk about those. If those hospitals come through as we anticipate, we will be 60 hospitals by the end of the year.

So our payor base continues to be stable. As you think about this, the Medicare, Medicaid, maintaining pretty consistent percentages across the years, so I think that's the point of this slide. We have a non-urban footprint, which allows us to have very minimal local competition. That means a couple of things. In 57 markets, we are the only hospital, 53x. So of our 57 markets, there are 53 markets where we are the only hospital.

Now even where we have the only hospital, there is still minimal competition from other providers such as surgery centers or diagnostic centers, urgent care centers even in smaller communities. So we have the ability, we have that presence, market share presence in all of our markets.

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